O'Rielly tests the waters as watchdog boss Pai pushes economic angle

FCC Commissioner Michael O'Rielly has said US Congress will have to resolve the tricky question of net neutrality.

"I've always said that anytime Congress can provide us direction and answer the question of how they would like the commission to implement something, then I am totally supportive," he told legal industry watchers Law360, adding: "When I talk to members, they're seeing what they can do and how soon and when people want to sit down and have conversations."

Although O'Rielly goes on to state that he doesn't believe the question looming over internet access rules has to be "one or the other" – meaning either dealt with in the FCC itself or with new laws through Congress – he repeatedly argues that the solution will come from both legislators and FCC chair Ajit Pai agreeing on the best course of action.

The comments are recognition that despite the fact that O'Rielly and Pai hold a Republican majority in the diminished three-person commission, and despite them having both voted against the Open Internet Order in April 2015, and having made the elimination of the rules a key goal under the new Trump Administration, they are not in the position to reverse them.

In much the same way Republicans have used the Affordable Care Act/Obamacare as a bogeyman and political rallying cry but have so far been unable to repeal or replace it due to the issue's complexities (and, don't say it too loudly, its advantages), the issue of the Open Internet Order/net neutrality has also proven to be more complex than simply discarding previous rules.

Judges, schmudges

O'Rielly is dismissive of the court decision that supported the Open Internet Order under the previous FCC chair, arguing that it resulted from a high level of deference to the regulatory body and that if the FCC "does a somewhat [good] job of explaining itself, it's fine."

He even suggests that the goalposts have moved with respect to court scrutiny over semi-autonomous federal regulators, saying: "In past life, it would have had to have been fully explained with data and economics, but I think this court is saying, 'Not as much needed anymore'."

That comment about data and economics is, however, one big clue to how O'Rielly and his close co-worker Pai hope to unravel the net neutrality rules.

On Wednesday, in a speech [PDF] at conservative think-tank the Hudson Institute, Pai announced the creation of a new Office of Economics & Data at the FCC.

Using a baseball analogy of how statistical analysis was used to build season-winning teams, Pai said: "I worry that's the path we've essentially been following recently at the FCC. Historically, the FCC had been a model for the use of economic analysis in federal policymaking. We hired and empowered a world-class economics staff. In turn, they've delivered policies that were a much bigger deal than a Cubs championship, unleashing hundreds of billions of dollars of consumer benefits."

Pai then argues that recently economic analysis has "become an afterthought, not an initial thought" at the regulator he now oversees, and that "now is the time to restore the place of economic analysis at the FCC."

And so the path that Pai has decided to follow – in order to step away from the previous administration's policies that designated internet access as a utility along the lines of the telephone – is laid out: he will focus on economic analysis rather than broader arguments about rights.

That may also prove to be a useful argument for Republican Congressmen as they seek to draw up new legislation to cover the modern internet world. As we have noted many times, the most recent broad telecommunications law was passed in 1996 – when the internet was very much in its infancy. The United States is in desperate need of an updated legislative foundation for the modern digital world.